The Graham & Dodd P/E MatrixGuest Post
The Graham & Dodd P/E Matrix by Redfield, Blonsky & Co.
Based on his observations of stock over the years, Benjamin Graham developed a stock valuation model that allows for future growth. Graham observed that the average no-growth stock sold at 8.5 times earnings, and that price-earnings ratios increased by twice the rate of earnings growth. This led to the earnings multiplier:
P/E = 8.5 + 2G
where G is the rate of earnings growth, stated as a percentage.
The original formulation . . .
This content is exclusively for paying members. Access all of our content on including years of timeless investment news and in depth analysis for only a few dollars a month by signing up here while also supporting quality content and journalism, or learn more about our premium content here
If you are subscribed and having an account error please clear cache and then cookies if that does not work email email@example.com and we will get back to you as quick as humanly possible